Summary
Fortinet, Inc. reported a 14% year-over-year increase in total revenue for the third quarter of 2013, reaching $154.7 million, driven by strong growth in its Services segment (+20% YoY). Product revenue also saw a healthy increase of 11% YoY. The company maintained a gross margin of 72% for the quarter, though operating income and margin saw a decrease compared to the prior year, primarily due to increased operating expenses. Research and Development and Sales & Marketing expenses rose significantly, reflecting continued investment in product development and sales force expansion. Despite the increased operating expenses, Fortinet generated solid operating cash flow and ended the quarter with a strong cash, cash equivalents, and investments balance of $841.0 million.
Financial Highlights
52 data points| Revenue | $154.70M |
| Cost of Revenue | $43.93M |
| Gross Profit | $110.77M |
| R&D Expenses | $26.42M |
| Operating Expenses | $92.49M |
| Operating Income | $18.28M |
| Net Income | $11.03M |
| EPS (Basic) | $0.01 |
| EPS (Diluted) | $0.01 |
| Shares Outstanding (Basic) | 814.53M |
| Shares Outstanding (Diluted) | 843.33M |
Key Highlights
- 1Total revenue for Q3 2013 increased by 14% year-over-year to $154.7 million.
- 2Services revenue showed robust growth of 20% year-over-year, while Product revenue grew by 11% year-over-year.
- 3Gross margin remained strong at 72% for the quarter.
- 4Operating expenses increased by 27% year-over-year, driven by investments in R&D and Sales & Marketing, leading to a lower operating income and margin compared to the previous year.
- 5Cash, cash equivalents, and investments grew to $841.0 million as of September 30, 2013.
- 6Deferred revenue increased by $37.0 million from the end of 2012, indicating strong future revenue potential, particularly from subscription and support services.